The performance of 500 large-cap stocks traded on US stock exchanges is tracked by the benchmark index known as the S&P 500. Investors frequently use it to evaluate their investment performance because it is regarded as a trustworthy measure of the general health of the US stock market.
Over the past ten years, if you had invested in the S&P 500, your money would have grown significantly. But what if you didn’t take advantage of that chance?
We’ll look at how $1,000 could have increased over the past 10 years in this post, along with what you can do right now to capitalize on the market’s potential.
The S&P 500’s Growth Over the Last Decade | What is S&P 500 10-year Return?
The S&P 500’s closing price on January 1, 2010, was 1,115.10. The S&P 500 ended at 4,133.52 on April 21, 2023, a rise of more than 276% over the previous ten years. A $1,000 investment in the S&P 500 on January 1, 2010, would now be worth $3,761, representing a 276% return on your capital.
The market can be volatile in the near term, so while this is an impressive return, it’s crucial to keep in mind that it was achieved over a ten-year period.
Investing in the S&P 500
The S&P 500 is a pretty simple index to invest in. The two major ways to invest in the index are through exchange-traded funds (ETFs) or index funds. Both types of funds give investors access to a diverse portfolio of large-cap equities while tracking the performance of the S&P 500.
People wishing to engage in the stock market frequently choose index funds and ETFs as their investment vehicles. They’re made to give investors exposure to a variety of stocks, allowing them to diversify their holdings and lower risk all around.
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The Benefits of Investing in the S&P 500
Investing in the S&P 500 has a number of advantages. First off, it lowers the risk associated with investing in individual firms by giving access to a diversified portfolio of large-cap stocks.
Second, historical data indicates that the S&P 500 will continue to do well over the long term. It has a lengthy history of great performance.
And finally, purchasing shares of the S&P 500 is both simple and inexpensive. Due to their minimal costs, index funds and ETFs are desirable investment options for anyone seeking to engage in the stock market on a tight budget.
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Investing in the S&P 500 FAQ
What is the S&P 500?
The performance of 500 large-cap publicly traded firms in the United States is tracked by the S&P 500 stock market index. It is frequently seen as a yardstick for the overall performance of the American stock market.
Is it too late to invest in the S&P 500 after missing out on the last decade of growth?
No, it’s never too late to start making stock market investments. Though the S&P 500’s previous success is no guarantee of future results, historical data points to the market continuing its strong long-term performance. By making an investment in an index fund or exchange-traded fund (ETF) that follows the performance of the S&P 500, you can gain access to a diversified portfolio of large-cap stocks and take advantage of the market’s potential growth.
Disclaimer- This article is strictly for educational purposes and does not provide any advice or tips on investment or recommend buying or selling any stocks.